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I just bought some overpriced food at Whole Foods

In response Whole Foods CEO John Mackey's sensible WSJ editorial, some leftists have organized a boycott. While I can understand how someone might disagree with parts of what Mackey wrote, a boycott? Really? For Whole Foods?

To me, enterprise is a function of property rights; that's justification enough in my book. But there are some who think businesses should seek a social good. There is suffering in the world from poverty, disease, and war, and free enterprise is a great (best?) way to alleviate it. As I said, I don't particularly subscribe to that view. I think a desire to make money is good enough; I'm old school like that. But if there's any corporation in America that embraces the business-as-positive-social-force viewpoint, it's Whole Foods.

I've long held theories about political movements as psychological phenomena on a massive social scale. One belief is that self-destructive personality traits on a grand scale get channeled into leftism.

To the boycotters: Is this really the corporation that you want to boycott? Based on that opinion piece?

In response, like Radley Balko, I just bought some overpriced food from the store, and will continue to do so until the boycott lasts.


Economic Growth vs Education

Latin America, Economic Growth and Education

"Conclusion
The dismal level of cognitive skills reached by Latin American countries can account for their poor growth performance since 1960. Student achievement test performance explains inter- and intra-regional growth differences. If countries in Latin America (and, by implication, Sub-Saharan Africa) want to improve their growth performance in the future, they need a “Millennium Learning Goal” (Filmer, Hasan, and Pritchett 2006), rather than mere quantitative targets of educational attainment. It is not simply going to school but only actual learning that counts for economic growth."

The idea that national economic growth is primarily limited by education, whether its quantity or its quality, is absurd.

While I have no knowledge of Latin America, the first place that I would look is for structural and cultural barriers to the formation of new private businesses.

The real question, to my mind, is which of the following economic changes would lead to a better economy?

1. Replace 25% of the plumbers with academic PhD level economists.

or

2. Replace 25% of the academic PhD level economists with plumbers.

Regards, Don


Failed Prohibition

Jacob Sullum recently wrote up some pretty ridiculous statements by Tommy Benton, GA state representative. He also included Benton's official email address, in case you wanted to share some thoughts. Here's what I shared:

Mr. Benton,

I've been alerted to your ideas about the sale and use of drugs. I
concede that a person might have reasons for taking this strong a
position about the use of substances, however wrong and frankly
un-American I think that might be.

But you've made a very important and all-too-common error: millions
upon millions of Americans already get high without fear of getting
arrested. Marijuana is everywhere. I have spent some time in
Valdosta, and while I didn't buy or use marijuana there, I could have
at the drop of a hat. The same goes for almost any place in the
country.

The current Prohibition is every bit as much of a failure as the
previous one, they're just not advertising speakeasies in the
newspaper. The typical government solution is to double down on its
failed policies--I hope you'll reconsider.

- Randall McElroy III


Freedom, Exit and Question-begging

Jonathan has a nice post up laying out the current debate about charter cities. He cites Arnold Kling's discussion of freedom as exit, calling it "elegant and powerful." I agree with Jonathan that this is a really good defense of exit.

But I also think Will has a good point in his response, namely, that defining freedom as the absence of monopoly may be question-begging. After all, if I live in a world of Hobbesian thugs, it's hard to make the case that I have any meaningful freedom, even if such a world is free from monopoly. It's not, however, question-begging in the way that Will thinks it is.

This, as with many other intra-libertarian debates, really boils back down to the whole rationalist-pluralist distinction. Arnold and Jonathan fall pretty solidly in the pluralist camp. And if you're a pluralist then the freedom = no monopolies construction does sound about right.

But if you're a rationalist, then such a construction is in fact going to look illiberal. Or, at the very least, it's going to look like something that doesn't guarantee liberalism. For those three people here who haven't already read Levy's piece, here's his definition of rationalism:

On the other we see a rationalist liberalism, committed to intellectual progress, universalism, and equality before a unified law, opposed to arbitrary and irrational distinctions and inequalities, and determined to disrupt local tyrannies in religious and ethnic groups, the family, the plantation, feudal institutions, and the provincial countryside.

I think that this is probably what Will has in mind when he calls charter cities illiberal. They fail to do anything like the liberalism that a rationalist champions. Oh, they might do so. But they are hardly a guarantee. But, more importantly, charter cities (and seasteading and exit in general) remove the very possibility of achieving any sort of universal rationalist liberalism. At the end of the day, Exit effectively puts its stamp of approval on "local tyrannies in religious and ethnic groups, the family, the plantation, feudal institutions and the provincial countryside" telling those who don't like it (i.e., any potential reformers) just to leave.

My own sympathies are with Will, though I think that I'm probably less committed to a pure rationalism than he. Exit (arguably) provides more opportunities for experimentation, something that the utilitarian in me approves of. After all, how else are we to discover what really works and what doesn't? But those same utilitarian impulses make me worry about the children we doom to grow up in religious fundamentalist societies where the little girls are taught that they should obey the boys and given little education in anything other than, say, cooking and making babies. And I worry, too, about the little boys who grow up learning that the Jews killed Jesus and that God sanctioned slavery right there in the Old Testament (it comes right after the part about killing the gays).

In liberal democracies, people are welcome to have such views. But they are not welcome to isolate themselves away with others who hold such views. Or, more to the point, they aren't allowed to raise their children in in such isolate enclaves. They must, instead, put those views into the mix of other different competing views. Their ideas must win out in the marketplace of ideas before they can become established law.

Deliberative democracy forces local illiberalism out into the open, where it must compete with (and ultimately lose out to) liberalism. Exit essentially provides protected spaces for illiberalism to continue.

Yes, I know that the argument is that eventually, when liberal experiments succeed and illiberal experiments don't, people will switch. But that assumes that people are capable of recognizing failure and have the basic education and knowledge to switch successfully. Unfortunately, exit doesn't guarantee that those preconditions will obtain.

Anyway, at the end of the day, I think this quibbling is unnecessary. My own view is that something like liberal democracy is going to turn out to be the best way we have to organize a society. Patri's seasteads are all going to turn into smaller liberal democracies with open immigration policies. At the same time, current liberal democracies are going to get more liberal and, eventually, go with open immigration policies. IOW, I expect both approaches will reach the same endpoint. The only debate, really, is over which one will get there first. I see no harm in trying both.


Charter Cities and Freedom

A debate has broken out in parts of the libertarian blogosphere about Charter Cities and the nature of freedom. Will Wilkinson got the ball rolling by calling Charter Cities "illiberal". A series of responses followed:

What is Real Freedom? by Arnold Kling

Freedom Is Exit, Not Voice by Patri Friedman

Arnold Kling on Freedom as Exit by Will Wilkinson

More Democraphilia from Will Wilkinson by Will Chamberlain

Liberal Democracy: D- or B+? by Patri Friedman

Unsurprisingly, I stand on the side of Exit. Arnold Kling's argument is so elegant and powerful that I'm going to quote the whole thing.

Which leads me to wonder: what is this "real freedom" of which you speak?

Consider the following definition of freedom: the absence of monopoly.

The absence of monopoly means that you can exercise exit, even if you cannot exercise voice. The presence of monopoly means that, at most, you can exercise voice.

Neither my local supermarket nor any of its suppliers has a way for me to exercise voice. They don't hold elections. They don't have town-hall meetings where they explain their plans for what will be in the store. By democratic standards, I am powerless in the supermarket.

And yet, I feel much freer in the supermarket than I do with respect to my county, state, or federal government. For each item in the supermarket, I can choose whether to put it into my cart and pay for it or leave it on the shelf. I can walk out of the supermarket at any time and go to a competing grocery.

The exercise of voice, including the right to vote, is not the ultimate expression of freedom. Rather, it is the last refuge of those who suffer under a monopoly. If we take it as given that the political jurisdiction where I reside is a monopoly, then perhaps I will have more influence over that monopoly if I have a right to vote and a right to organize opposition than if I do not. However, as my forthcoming Unchecked and Unbalanced argues, the reality is that the amount of influence I have is shrinking while the scope of the monopolist is growing.

The idea of charter cities (or seasteading) will be a success to the extent that it creates a viable exit option vis-a-vis government. Suppose that the Chinese government loses its monopoly power, because it becomes easy for people residing in China to choose to live under alternative governments. In that hypothetical case, I would argue that those residents are free, even if those who choose the Chinese government are not allowed to vote in contested elections or to freely criticize their government. If you lived in North Korea, which would you rather have--the right to vote or the right to leave?

In fact, if we had real competitive government, then we would be no more interested in elections and speaking out to government officials than we are in holding elections and town-hall meetings at the supermarket. I repeat: real freedom is the absence of monopoly.


The absurdity of trusting checks and balances

A friend of mine, the Rough Ol' Boy, writes up Ezra Klein's piece on the madness of the health care debate and Will Wilkinson's response. All are worth reading, but I'm highlighting R.O.B.'s conclusion here:

But I think Klein actually does make a salient point about political systems in general, but it proves far more than he wants it to. I Klein is correct when he writes that

[a] healthy relationship does not require an explicit detailing of the “institutional checks” that will prevent one partner from beating or killing the other. In a healthy relationship, such madness is simply unthinkable. If it was not unthinkable, then no number of institutional checks could repair that relationship.

But of course these institutional checks are the entire basis for our political system–think the Bill of Rights, federalism, checks and balances, etc. And, when push comes to shove, they don’t work. If you put a huge amount of power into relatively few hands (i.e. form a government), it will be abused no matter how much you attempt to safeguard it. Klein probably wasn’t aware that he was arguing for anarchy, but he was.


Paul Romer: He's Kind of a Big Deal

I suspect that the majority of readers of the DR are also interested in seasteading and related matters, so this is probably old news to most of the people here. But I think it's important enough to warrant at least a passing mention.

Stanford's Paul Romer recently launched a project very related to seasteading that he's calling Charter Cities. The basic idea is that governments in Third World countries should contract with other countries to manage parts of their territory. Think Hong Kong being run by the British but staffed by the Chinese. True, governments are still involved, so it wouldn't satisfy the ancaps here. But it has the advantage of (maybe) being more acceptable to governments and more likely to take off, and (definitely) easier from an engineering perspective.

(Which is easy for me to say I suppose. Although I'm quite enthusiastic about seasteading, I'm probably not nearly as radical in my beliefs as the average interested person. Singapore + drug legalization/end of conscription is probably good enough for me.)

Now, I'm not sure what Paul Romer thinks of seasteading, although I see that he's speaking at the Seasteading Institute conference this fall. But Charter Cities would be a major step in the direction of "intentional government", and strikes me as one of the most hopeful methods for helping the global poor that I've heard in a long time. I'll probably have more to say about that in some later posts. That alone bodes well for seasteading.

But here's my elitist reason for why I view this as such an incredibly positive development for the seasteading movement. As I see it, seasteading suffers from the view that it's about rich people evading taxes or smoking dope. But even more than that, it suffers from a overall weirdness factor that's difficult to overcome.

But Paul Romer is not some random grad student blogger like yours truly. He's not some kook railing about the evils of fractional reserve banking in 10000 word screeds. He's one of the more important economists alive today, a man who fundamentally reshaped how we think about economic growth. He's mainstream, and he's certain to win a Nobel Prize, probably in the near future.

The engineering challenges of seasteading are high, but perhaps more difficult is developing the idea that the government you live under should be a competitive choice. To the extent that mainstream, respected people promote this view, seasteading becomes more probable. Having people on your side like Paul Romer is a major step in that direction.


The Future of Work

In Sunday's Washington Post, first-rate economic historian Gregory Clark lays out his dystopian case for greater redistribution in the future. Basically, unskilled labor will become worthless with increasing automation and robotic technology:

In more recent decades, when average U.S. incomes roughly doubled, there has been little gain in the real earnings of the unskilled. And, more darkly, computer advances suggest these redoubts of human skill will sooner or later fall to machines. We may have already reached the historical peak in the earning power of low-skilled workers, and may look back on the mid-20th century as the great era of the common man.

I recently carried out a complicated phone transaction with United Airlines but never once spoke to a human; my mechanical interlocutor seemed no less capable than the Indian call-center operatives it replaced. Outsourcing to India and China may be only a brief historical interlude before the great outsourcing yet to come -- to machines. And as machines expand their domain, basic wages could easily fall so low that families cannot support themselves without public assistance.

I think Will Wilkinson does an admirable job here of explaining why this outlook is excessively pessimistic. But what I'd like to address is the question of what will these people be doing, if not manufacturing.

Now, I don't think it's incumbent on technological optimists such as myself to answer this. Two hundred plus years of the Industrial Revolution have taught us that labor market adjustments will eventually take place. But I'd like to take a stab at it anyway: Where will the new jobs come from? (Note: I'm leaving aside scenarios such as true, human-or-greater level AI. I'm talking about "mundane" technological progress here.)

Myself, I think it's pretty clear, actually. The growth sector of the future is in personal service. As automation reduces the cost of physical goods, the relative value of things like massages or even basic housecleaning rises. In the robot-dominated future, no capitalist is going to want to waste his scarce time cleaning or cooking. He'll outsource that, and it's difficult to imagine robots taking over cooking for a long time.

Is that a society we want? Many people of an egalitarian outlook seem to recoil at the notion of servants. Myself, I don't find it particularly bothersome; I do not find plowing through exams as a grader much more dignified than being a chauffeur would be. Nevertheless, it's not about what I would want, it's about what society will look like. And I think the future is servants.

Does anyone else want to take a stab at it? When robots handle manufacturing, what will the low-skilled do?


Yglesias and his playground gang

Brian Moore points to Matthew Yglesias trying to define libertarianism. Nothing too insightful there, but if you really want to learn what the uncritical left-wing mind thinks about libertarianism, read the comments.

I'd post over there, but what's the point? If anyone enjoys wrestling with pigs, maybe you can ask them how this whole progressive dream that is the Obama presidency + Democratic Congress is going.


Millions of drug users, no societal collapse

Economix has an interactive map of U.S. drug use. According to the statistics, 8.1% of people had used drugs within the month prior to the surveys (in 2006 and 2007). That's just over 24 million people.